Tag: Tesla

Elon Musk pushes plan for China data to power Tesla’s AI ambitions

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

Tesla is pushing ahead with plans to power the global development of its self-driving system with data from China that could be processed within the country, part of a strategic shift by Elon Musk, according to people with knowledge of the work.

As part of that effort, Tesla has been developing plans for a data centre in China to train the algorithm needed for more fully autonomous vehicles, according to two people, who asked not to be named because the work remains private.

Until recently, Tesla has focused on efforts to secure approval from Chinese regulators to transfer data generated by its EVs in China out of the country for its “Full Self Driving” (FSD) system, according to the two people and an additional person with knowledge of the matter.

It was not clear if Tesla would proceed with both options for handling self-driving data from China — data transfer and a local data centre — or if it was developing parallel plans as a hedge.

Tesla’s efforts underscore the speed of the electric vehicle maker’s pivot to bet on a breakthrough in AI at a time when EV demand has slowed and its competition has deepened.

Its push to make fuller use of data from vehicles in China to develop the automaker’s artificial intelligence for driving comes as the US government has tried to clamp down on the transfer of AI technology from US firms to China.

Tesla has not been able to offer the full version of FSD, which costs the equivalent of almost $9,000, in China.

A wider market for FSD in China would give a boost to the automaker’s revenue and profits at a time when both are getting squeezed by pressure from Chinese rivals such as BYD.

Tesla did not respond to a request for comment.

Setting up a data centre in China for FSD development would require Tesla to work with a Chinese partner, two of the sources said. There is also a potential hardware-sourcing challenge.

It has had talks with Nvidia about acquiring graphic processing units for a China data centre, according to one of the people, who was briefed on the discussions. US sanctions bar Nvidia and its partners from selling its most advanced chips in China.

Nvidia declined to comment on whether it had held talks with Tesla.

Tesla’s campaign to make more use of data from China was kicked into high gear in a whirlwind trip by Musk to Beijing last month when he met with officials including Premier Li Qiang.

In his meeting with Li, Musk sought to smooth permissions for Tesla’s data transfer, two of the sources said. The potential of Tesla investing in a data centre in China was also raised, they said.

Musk also discussed the possibility of Tesla licensing its FSD systems to Chinese EV makers, one person said. Musk had said in April Tesla was talking to another “major” automaker about licensing FSD without naming it.

China’s State Council Information Office did not respond to a request for comment.

THE CHINA EFFECT

China, the world’s largest car market, has the biggest fleet of sensor-equipped cars capable of collecting data from congested cities with complicated traffic patterns, making data generated there valuable for automakers and AI providers.

Musk previously expressed opposition to a China-based data centre, arguing that data transfer to the United States was the most efficient option, two people said.

Since 2021, Tesla has stored data collected by its Chinese EVs in Shanghai. Over that time, Tesla’s China team has been seeking approvals from Chinese regulators to transfer data out of the country, two people said.

Under a one-year pilot project, companies in Shanghai’s Lingang Area, where Tesla’s factory is located, will be allowed to transfer certain data without needing further security assessments, Reuters reported on Friday.

Some analysts see Musk as trying to make China a launchpad for self-driving in the same way Tesla’s 2019 bet on its Shanghai Gigafactory allowed it to break through as a mass-market electric vehicle maker.

“It would definitely be a milestone for Tesla if it rolls out FSD in China and leverages the China data for algorithm training,” said Yale Zhang, managing director at Shanghai-based consultancy Automotive Foresight.

“China had played a key role in scaling up EV production for Tesla with the Shanghai factory. It would again serve a significant part in scaling up mass adoption of autonomous driving technologies,” he said.

Many industry experts expect it will take years before fully autonomous cars are commonplace, but predictions vary widely.

Driver-assistance features now offered in China are “level two” systems, meaning they require a driver ready to take over. Tesla’s FSD and its less-advanced options of Autopilot, are also level-two systems requiring attentive drivers.

More fully automated vehicle fleets operated by Baidu, China’s biggest search engine operator, and Pony.ai, an autonomous driving startup, run in limited test zones.

But China’s EV makers, including BYD, have made self-driving and advanced driver-assist systems a priority. Mercedes and BMW have been granted licenses to test level-three systems that allow drivers to take their hands off the wheel and look away on a wider range of roads in China.

At least five automakers — Hyundai, Mazda, Toyota, Volkswagen and Nissan — have approval to transfer some of their data out of China, but none of those approvals are for data to be used to train AI systems, according to lawyers, state media reports and analysts.

Penalties for violating data privacy laws that came into effect in China in 2021 are a major risk factor for data operations, groups representing foreign businesses in China say.

When asked about competition from Chinese EV makers during a call with investors after Tesla’s quarterly earnings last month, Musk said Tesla should be viewed more as an AI company.

He said he was confident Tesla’s FSD system would work “pretty well without modification in almost any market”. It would work better with “country-specific” training, Musk said.

Also Read: Tesla’s autonomous robotaxis to be tested in China, CEO Elon Musk reveals

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Tesla plans to cut 601 more jobs in California, notice to government says

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

Tesla plans to lay off an additional 601 employees in California, it said in a notice to the state government, as the automaker undertakes a series of job cuts globally that began a month ago amid falling sales and intensifying price competition.

Tesla CEO Elon Musk said on April 15 that the company would lay off more than 10% of its global workforce, which stood at over 140,000 in late 2023. The electric vehicle maker has conducted several rounds of job cuts since then, as Musk wanted to slash 20% of its headcount, according to people familiar with the matter.

The latest layoff plan would affect employees at Tesla’s facilities in Palo Alto and Fremont, California, and will start for 14 days beginning on June 20, 2024, Tesla said in its Worker Adjustment and Retraining Notification (WARN).

The electric carmaker said last month it would lay off 6,020 people in California and Texas, as part of the headcount cuts.

The global job reductions also included 285 employees at its Buffalo, New York facilities that house the labelling team for its Autopilot driver assistance software and which makes fast-charging equipment.

Musk disbanded Tesla’s Supercharger team on April 30.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Elon Musk Update | After sacking entire Supercharger team, Tesla CEO reveals big plans to expand unit

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

Tesla CEO Elon Musk has reaffirmed his company’s commitment to growing its Supercharger network days after the entire team in charge of building it was sacked by the US-based EV manufacturer.

In a recent statement shared on X, Musk said, “Just to reiterate: Tesla will spend well over $500M expanding our Supercharger network to create thousands of NEW chargers this year. That’s just on new sites and expansions, not counting operations costs, which are much higher.”

Just to reiterate: Tesla will spend well over $500M expanding our Supercharger network to create thousands of NEW chargers this year.

That’s just on new sites and expansions, not counting operations costs, which are much higher.

— Elon Musk (@elonmusk) May 10, 2024

In another tweet, Elon Musk announced the formation of a new Tesla group called the ‘Supercharger Community’ on X. Musk is one of the group’s current members of less than 10. Each new applicant must be accepted before joining the community.

The entrepreneur withheld the reason behind founding this community. It was most likely established to allow Tesla owners to discuss various aspects of their electric vehicles.

Just started a Supercharger Community
https://t.co/o5QSGCfrp3

— Elon Musk (@elonmusk) May 10, 2024

In late April, Tesla revealed that its first quarter earnings had dropped to the lowest since 2021. The company this went handed dismissed much of its Supercharger team.

Approximately 500 employees were sacked by Tesla, among them Rebecca Tinucci, the division’s six-year team leader, according to a Financial Times article from April 30 which cited a memo sent out by Musk.

Tinucci has played a pivotal role in spearheading Tesla’s electric car charging enterprise and persuading all prominent Western automakers to adopt the North American Charging Standard (NACS).

US President Joe Biden praised Tesla for these arrangements, which opened the door to federal funding to increase the NACS’s reach, as per Quartz.

Musk appears to have addressed the reduction on X, stating that the Supercharger network will continue to develop, “just at a slower pace” for new stations, with a greater emphasis on 100% uptime and expanding current facilities.

Tesla still plans to grow the Supercharger network, just at a slower pace for new locations and more focus on 100% uptime and expansion of existing locations

— Elon Musk (@elonmusk) April 30, 2024

As reported by Forbes, Tesla slashed its Supercharger staff a few months after reaching agreements to provide major automakers like Ford and General Motors access to Tesla’s network of electric vehicle charging stations.

ALSO READ: Tesla interns say offers are getting revoked weeks before their start date

Tesla’s Supercharger is a network of integrated, exclusive charging stations created and managed by Tesla. Therefore, unlike the majority of automakers now producing electric vehicles, the automaker is not dependent on third-party charging networks.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Elon Musk may be compelled to testify again in SEC’s Twitter takeover probe

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

A federal judge on Thursday indicated a willingness to compel Elon Musk to testify again in the U.S. Securities and Exchange Commission’s investigation into his $44 billion takeover of Twitter.

Lawyers for the billionaire appeared in a San Francisco courtroom on Thursday to urge U.S. District Judge Jacqueline Scott Corley to decide against the SEC, which is seeking to force Musk to testify as part of its probe into his 2022 purchase of social media giant Twitter. Another judge previously ruled in favor of the agency.

The SEC sued Musk in October to compel the Tesla and SpaceX CEO to testify after he refused to attend a September interview for the investigation, saying the SEC was trying to “harass” him with a number of subpoenas.

The judge did not issue a decision on Thursday.

“I don’t think that the deposition subpoena is unreasonable. What I don’t know is why does the deposition have to be at an SEC office?” Corley said at a hearing at the United States District Court for the Northern District of California.

The investigation concerns whether Musk broke federal securities laws in 2022 when he bought stock in Twitter, which he later renamed X. It is also reviewing statements and SEC filings he made in relation to the deal, the agency has previously said.

In 2022, Musk supplied the SEC with documents for its probe and also testified via videoconference for two half-day sessions in July of that year, the SEC has said in court documents. Agency lawyers have said they have more questions for Musk after receiving new documents, and had sought additional testimony.

Musk’s lawyer, Rachel Frank, an associate with Quinn Emanuel Urquhart & Sullivan, on Thursday told the judge the additional testimony would be a “burden” for Musk and take him away from obligations to shareholders.

The judge asked whether Musk should be exempt from securities laws and further investigations just because he is a “very busy person” who is running multiple companies.

Musk did not immediately respond to a request for comment.

Thursday’s face-off is the latest dispute in a years-long feud between Musk and the top U.S. markets regulator, dating back to 2018 when he tweeted that he had “funding secured” to take the electric carmaker private.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Tesla under scrutiny: US prosecutors probe potential securities, wire fraud

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

US prosecutors are examining whether Tesla committed securities or wire fraud by misleading investors and consumers about its electric vehicles’ self-driving capabilities, three people familiar with the matter told Reuters.

Tesla’s Autopilot and Full Self-Driving systems assist with steering, braking and lane changes – but are not fully autonomous. While Tesla has warned drivers to stay ready to take over driving, the Justice Department is examining other statements by Tesla and Chief Executive Elon Musk suggesting its cars can drive themselves.

US regulators have separately investigated hundreds of crashes, including fatal ones, that have occurred in Teslas with Autopilot engaged, resulting in a mass recall by the automaker.

Reuters exclusively reported the US criminal investigation into Tesla in October 2022, and is now the first to report the specific criminal liability federal prosecutors are examining.

Investigators are exploring whether Tesla committed wire fraud, which involves deception in interstate communications, by misleading consumers about its driver-assistance systems, the sources said. They are also examining whether Tesla committed securities fraud by deceiving investors, two of the sources said.

The Securities and Exchange Commission is also investigating Tesla’s representations about driver-assistance systems to investors, one of the people said. The SEC declined to comment.

Tesla did not respond to a request for comment. Last October, it disclosed in a filing that the Justice Department had asked the company for information about Autopilot and Full Self-Driving.

The Justice Department declined to comment.

The probe, which is not evidence of wrongdoing, could result in criminal charges, civil sanctions, or no action. Prosecutors are far from deciding how to proceed, one of the sources said, in part because they are sifting through voluminous documents Tesla provided in response to subpoenas.

Reuters could not determine the specific statements prosecutors are reviewing as potentially illegal. Musk has aggressively touted the prowess of Tesla’s driver-assistance technology for nearly a decade.

Tesla videos demonstrating the technology that remain archived on its website say: “The person in the driver’s seat is only there for legal reasons. He is not doing anything. The car is driving itself.”

A Tesla engineer testified in 2022 in a lawsuit over a fatal crash involving Autopilot that one of the videos, posted in October 2016, intended to show the technology’s potential and did not accurately portray its capabilities at the time. Musk nevertheless posted the video on social media, writing: “Tesla drives itself (no human input at all) thru urban streets to highway streets, then finds a parking spot.”

In a conference call with reporters in 2016, Musk described Autopilot as “probably better” than a human driver. During an October 2022 call, Musk addressed a forthcoming FSD upgrade he said would allow customers to travel “to your work, your friend’s house, to the grocery store without you touching the wheel.”

Musk is increasingly focused on self-driving technology as Tesla’s car sales and profit slump. Tesla recently slashed costs through mass layoffs and shelved plans for a long-awaited $25,000 model that had been expected to drive sales growth.

“Going balls to the wall for autonomy is a blindingly obvious move,” the billionaire executive posted on his social-media platform X in mid-April. Tesla shares, down more than 29% so far this year, surged in late April when Musk visited China and made progress toward approvals to sell FSD there.

Musk has repeatedly promised self-driving Teslas for about a decade. “Mere failure to realize a long-term, aspirational goal is not fraud,” Tesla lawyers said in a 2022 court filing.

LEGAL CHALLENGES

Prosecutors scrutinizing Tesla’s autonomous-car claims are proceeding with caution, recognizing the legal hurdles they face, the people familiar with the inquiry said.

They will need to demonstrate that Tesla’s claims crossed a line from legal salesmanship to material and knowingly false statements that unlawfully harmed consumers or investors, three legal experts uninvolved in the probe told Reuters.

US courts previously have ruled that “puffery” or “corporate optimism” regarding product claims do not amount to fraud. In 2008, a federal appeals court ruled that statements of corporate optimism alone do not demonstrate that a company official intentionally misled investors.

Justice Department officials will likely seek internal Tesla communications as evidence that Musk or others knew they were making false statements, said Daniel Richman, a Columbia Law School professor and former federal prosecutor. That is a challenge, Richman said, but the safety risk involved in overselling self-driving systems also “speaks to the seriousness with which prosecutors, a judge and jury would take the statements.”

FATAL CRASHES

Tesla’s claims about Autopilot and FSD have also drawn scrutiny in regulatory investigations and lawsuits.

Safety regulators and courts have raised concerns in recent months that corporate messaging about the technology – including the brand names Autopilot and Full Self-Driving – have imbued customers with a false sense of security.

In April, the Washington State Patrol arrested a man on suspicion of vehicular homicide after his Tesla, with Autopilot engaged, struck and killed a motorcyclist while the driver looked at his phone, police records show. In a probable-cause statement, a trooper cited the driver’s “admitted inattention to driving, while on autopilot mode … putting trust in the machine to drive for him.”

In Washington state, a driver remains “responsible for the safe and legal operation of that vehicle” regardless of its technological capabilities, a state patrol spokesperson told Reuters.

The same month, the US National Highway Traffic Safety Administration launched an investigation into whether a Tesla recall of more than 2 million vehicles in December adequately addressed safety issues with Autopilot.

NHTSA declined to comment.

After this story was published, US Senator Edward Markey, a Massachusetts Democrat and longstanding critic of the company’s driver-assistance systems, said in a statement posted on X that he was “glad to see” NHTSA and Justice Department officials “getting tough on Tesla over these dangers.”

The recall followed a long-running probe opened by regulators after cars with Autopilot engaged repeatedly crashed into vehicles at first-responder emergency scenes. Regulators subsequently examined hundreds of crashes where Autopilot was engaged and identified 14 deaths and 54 injuries.

Tesla disputed NHTSA’s findings but agreed to the recall, which employed over-the-air software updates intended to alert inattentive drivers.

The NHTSA investigation found “a critical safety gap between drivers’ expectations” of Tesla’s technology “and the system’s true capabilities,” according to agency records. “This gap led to foreseeable misuse and avoidable crashes.”

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Tesla’s autonomous robotaxis to be tested in China, CEO Elon Musk reveals

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

Elon Musk proposed testing Tesla’s advanced driver-assistance package in China by deploying it in robotaxis, during his recent visit to the country, the state-backed China Daily newspaper reported on Wednesday, citing sources.

Chinese officials told the Tesla CEO that China “welcomes Tesla to do some robotaxi tests in the country” and hopes it can “set a good example”, the newspaper quoted the sources as saying.

However, Chinese authorities did not immediately approve its widespread use of Full Self-Driving (FSD) functions, the newspaper added.

Before the full rollout of its FSD functions, Tesla still needs to get approval to collect and transfer data that Tesla’s cars need to train its driver-assistance features. The newspaper added that this issue wasn’t discussed in detail during Musk’s visit.

A person briefed on the matter told Reuters that Tesla is seeking to apply to launch the robotaxi tests in Shanghai, where the company’s largest factory globally is located.

Tesla and the Shanghai city government did not immediately respond to a request for comment.

The China Daily report comes shortly after Tesla CEO Elon Musk made a whirlwind weekend trip to Beijing late last month, where he met Chinese Premier Li Qiang.

Musk on the trip intended to discuss the rollout of FSD and whether Tesla could secure government approvals to transfer data overseas that could prove pivotal in its development of autonomous vehicles, Reuters previously reported.

FSD is the most autonomous version of Autopilot software and was rolled out in 2020. Its features include self-parking, auto lane changes and traffic navigation.

Among the wins during Musk’s trip, which was first reported by Reuters, was a key endorsement from a top Chinese auto association that said Tesla’s Model 3 and Y cars were compliant with data-security regulations. That would enable local governments to allow Tesla cars into parts of China they were previously barred from, Chinese media reported, citing a statement from Tesla.

Tesla has also reached an agreement with Baidu to use the Chinese tech giant’s mapping license for data collection on China’s public roads, according to two people who at the time described that as a step toward FSD rollout in China.

The China Daily newspaper, however, citing a source close to Baidu, said that the deal only meant that the accuracy of Baidu’s maps provided to Tesla would be improved and that it had no direct relation with FSD.

Baidu did not immediately respond to a request for comment.

Musk has abandoned a longstanding goal for Tesla to make affordable electric cars for the masses and is looking to focus on autonomous driving software, robotaxis and its humanoid robot Optimus.

Last month, the company mentioned a “purpose-built robotaxi product” that it planned to build with a “revolutionary” manufacturing process, without offering a timeline for its release.

China has been at the forefront in the development of self-driving cars, and companies such as Baidu and Toyota-backed Pony.ai have launched robotaxi services in limited test zones in several cities.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Tesla vs Tesla: US carmaker sues Indian namesake for copying trademark

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

Elon Musk’s carmaker Tesla has sued an Indian battery maker for infringing its trademark by using the brand name “Tesla Power” to promote its products, seeking damages and a permanent injunction against the company from a New Delhi judge.

Tesla in a hearing at the Delhi High Court this week said the Indian company had continued advertising its products with the “Tesla Power” brand despite a cease-and-desist notice sent in April 2022, according to details of the proceedings posted on the court website on Friday.

During the hearing, the Indian company, Tesla Power India Pvt Ltd, argued its main business is to make “lead acid batteries” and it has no intention of making electric vehicles.

The judge allowed the Indian firm three weeks to submit written responses after it handed over a set of documents in support of its defence, the court record shows.

Musk’s Tesla is incorporated in Delaware, and it has accused the Indian company of using trade names “Tesla Power” and “Tesla Power USA”. The court record included screenshots of a website that showed that Tesla Power USA LLC was also headquartered in Delaware and had been “acknowledged for being a pioneer and leader in introducing affordable batteries” with “a very strong presence in India”.

A Tesla Power representative told Reuters it has been present in India much before Musk’s Tesla and had all government approvals. “We have never claimed to be related to Elon Musk’s Tesla,” Tesla Power’s Manoj Pahwa said.

Tesla told the judge it discovered the Indian company was using its brand name in 2022 and has unsuccessfully tried stop it from doing so, forcing it to file the lawsuit.

The case comes after Musk cancelled his planned visit to India on April 21 to meet Prime Minister Narendra Modi.

Days later, Musk made a surprise visit to China and made progress towards rolling out its advanced driver assistance package, a move that many Indian commentators called a snub.

The Tesla India trademark case will next be heard on May 22.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Tesla retreats from next-generation ‘gigacasting’ manufacturing process: Sources

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

Tesla has backed away from an ambitious plan for innovations in gigacasting, its pioneering manufacturing process, according to two sources familiar with the matter, in another sign that the electric-vehicle maker is retrenching amid falling sales and rising competition.

Tesla has been a leader in gigacasting, a cutting-edge technique that uses huge presses with thousands of tons of clamping pressure to die-cast large sections of the car’s underbody. On a typical vehicle, the underbody can consist of hundreds of individual parts.

Last year, as Tesla developed a new small-vehicle platform, it aimed to punch out the underbody in a single piece, Reuters exclusively reported last September, citing five sources familiar with the automaker’s gigacasting operations. The long-term goal was to radically simplify manufacturing and slash costs.

But Tesla has since halted the effort, opting to stick with its more proven method of casting vehicle underbodies in three pieces: two gigacasted front and rear sections and a midsection made of aluminium and steel frames to store batteries, according to the two sources familiar with the matter. That is largely the same three-piece method the company has used for its last two new models, the Model Y crossover SUV and the Cybertruck pickup.

Tesla’s retreat from one-piece gigacasting has not been previously reported. The automaker did not respond to a request for comment.

The decision to hold off on the potential manufacturing breakthrough marks another example of Tesla slashing short-term spending as it adjusts to falling sales and profit margins, softening EV demand globally, and intensifying competition from rival EV makers such as China’s BYD. Tesla last month laid off more than 10% of its global workforce. A handful of senior executives have also resigned or been pushed out.

Such moves also reflect a fundamental strategy shift, with Tesla now focusing more on developing self-driving vehicles than on pushing for huge growth in EV sales volume, which many investors had been counting on.

The step-back on gigacasting occurred last autumn, the people said, before Tesla decided in late February to halt the development of an all-new affordable car, often called the Model 2, which would have been the first vehicle built with one-piece gigacasting. Reuters first reported the cancellation of the Model 2 on April 5.

On April 23, as it released earnings that missed Wall Street expectations, Tesla said it had a simpler, faster plan for producing “more affordable” cars after shelving plans for the Model 2, which was expected to cost $25,000 and be released in the second half of 2025.

Instead, Tesla officials said, it would produce affordable models using a current platform and production lines. On an investor call, Chief Executive Elon Musk declined to provide details on the planned new offerings or their target prices.

Tesla has not entirely abandoned the small-vehicle platform it had planned for the Model 2. Instead, it will move forward in developing a self-driving robotaxi on the same platform, Reuters reported in the April 5 story. One of the two sources familiar with the automaker’s gigacasting operations said the suppliers involved are now adapting Tesla’s three-piece process for the next-generation vehicle.

Both sources said the automaker decided last autumn to halt work on the more innovative and difficult one-piece casting process. At the time, the rationale for the decision was to speed the development of the now-defunct Model 2 and avoid any costly delays or manufacturing problems, the two sources said.

BIG UPFRONT INVESTMENT

Tesla and Musk have said gigacasting helps the automaker reduce costs over the long term. But the process requires large initial investments and is difficult and time-consuming to perfect, automotive manufacturing experts say.

Experts in vehicle manufacturing said Tesla’s more conservative path on gigacasting is no surprise and in part reflects the pains it has experienced historically in launching complex and innovative vehicles on time. The automaker’s highly experimental Cybertruck arrived last autumn at a far higher price than predicted after substantial delays to work through manufacturing issues. Tesla is still struggling to produce the angular, stainless-steel pickup in mass-market volumes.

Holding off on one-piece gigacasting will save the company from making massive short-term capital investments in manufacturing and design, said Terry Woychowski, president of US engineering company Caresoft Global, who has led teardowns and engineering analyses on numerous vehicles, including Teslas.

“Would they rather have done it all in one big piece? Sure, they would’ve, but at what cost?” Woychowski asked.

James Womack, a vehicle manufacturing expert and former research director at the Massachusetts Institute of Technology, said Tesla’s gigacasting pullback reflects the company’s scramble last year to launch an all-new $25,000 car to catch up with Chinese EV makers who are already dominating the low-cost EV segment.

But pushing forward with an innovative production technique would do little to help sell a Tesla car to consumers, Womack said.

“It’s not very exciting from the standpoint of the public and buyer,” Womack said, “and you don’t know whether this is really a big cost-saver or not.”

Also Read: Tesla’s Full Self-Driving system gears up for China, intensifying global autonomous vehicle race

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Tesla interns say offers are getting revoked weeks before their start date

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

Elon Musk’s latest cost-cutting victims: Summer interns.

Tesla Inc. is rescinding offers just weeks before internships were set to start, prompting aspiring employees to take to LinkedIn to appeal to other employers to take them in.

“At 8:46am, I opened a Tesla email for flight info. By 11:25am, my internship offer was gone,” wrote Miami University student Joshua Schreiber, who said his start date was three weeks away and that he had already spent “thousands on housing.”

Schreiber, like many other would-be Tesla interns, are getting dangerously close to the end of the school year. They say the surprise calls from Tesla informing students that their offers no longer stand have left them without a lot of time to find replacement gigs for the summer.

Also Read: Elon Musk sacks entire Supercharger team in a bid to be ‘hardcore’ about cost reduction

In one instance, a current Tesla employee posted on LinkedIn, asking her own virtual network to step up and nab one of the interns that was meant to start soon at the carmaker. “Please make our loss your gain!” wrote Diana Rosenberg, who works in battery supply at Tesla, according to her profile.

Rosenberg blamed the decision to rescind the intern offer on the massive layoffs unfolding at the carmaker.

Last month, Musk announced that Tesla had “made the difficult decision to reduce our headcount by more than 10% globally.” Since then, several executives have left the company as Musk has pushed for further cuts. Most of the company’s 500-person Supercharger division and its newly formed marketing division have been axed, Bloomberg News has reported.

People familiar with Musk’s thinking have said the billionaire is determined to cut head count amid sagging electric vehicle sales and big expenditures for his Robotaxi dreams. They say Musk is targeting a 20% reduction, Bloomberg reported.

Revoking intern offers isn’t likely to save Tesla much money. At least one of the posts was for an unpaid position, while paid internships at the automaker typically offer $18 to $28 an hour, according to data from Glassdoor.

Also Read: Elon Musk says Tesla robotaxi will be like a combo of Airbnb and Uber

But the decisions will have an impact in the company’s hiring pipeline: More than 3,000 university and community college students from around the world are hired for Tesla internships each year, according to the company’s last Impact Report. “Perform meaningful work from day one,” reads the company’s intern website.

The move has also delivered a stark life lesson to the students.

“Rejection is redirection,” wrote Brook Gura, a communications student at the University of Texas at Austin, who said that she got a call that her offer was yanked three weeks before her start date as part of the company’s mass layoffs. “While I am incredibly disappointed that I will not have the summer I intended to have, I know that this moment will only help me grow stronger as a professional.”

Gura, Schreiber and Rosenberg declined to comment beyond their posts. Musk didn’t respond to a request for comment.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Elon Musk sacks entire Supercharger team in a bid to be ‘hardcore’ about cost reduction

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

Tesla CEO Elon Musk has eliminated the company’s entire Supercharger team, including senior director Rebecca Tinucci. The move, confirmed by leaked internal emails, has raised concerns within the company and the EV industry.

Tinucci, the company’s most senior female executive, and an estimated 500 Supercharger employees were dismissed. This action follows similar patterns to Musk’s layoffs at Twitter and recent company-wide job cuts at Tesla.

Confirmed – @Tesla @elonmusk has let our entire charging org go. What this means for the charging network, NACS, and all the exciting work we were doing across the industry, I don’t yet know. What a wild ride it has been.

— willjameson (@willjameson) April 30, 2024

The decision is surprising given the Supercharger network’s importance to Tesla’s success and its role in reducing range anxiety for EV customers. Analysts and industry experts have expressed concerns about the move, especially with other automakers now adopting Tesla’s charging standard.

This development comes just weeks after Tinucci presented Tesla’s Supercharger strategy at Investor Day.

Musk has also fired another senior executive, Daniel Ho, head of new products, in a continued round of job cuts attributed to poor sales, reports The Information. Ho and affected employees were notified via email.

CEO Elon Musk’s email emphasised cost reduction, stating, “We need to be absolutely hardcore about headcount and cost reduction.” Additionally, Tesla’s public policy team, previously led by Rohan Patel, has been dissolved. Patel left the company shortly before Musk cancelled a planned trip to India, where Tesla’s market entry was anticipated.

Also read: Tesla’s Full Self-Driving system gears up for China, intensifying global autonomous vehicle race

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow